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Problem No.1. Trading Securities At December 31, 2017, BAGCPARS Company properly reported the following Trading equity securities: Page 1 EDA Corporation, 1000 shares, Preference shares DJOA, Inc. 6,000 shares of ordinary shares RVFE Co., 2000 shares Total Cost Market Value P30,000 90,000 80,000 P200,000 February 14 P40,000 60,000 55,000 P155,000 During 2018, the following transactions occurred among others: January 5 Acquired 8,000 shares of ARP Co. for P880,000 incurring additional P10,000 for brokerage and another P10,000 for commission. These shares are to be initially recognized as trading securities Received dividends from ARP Co. declared January 10, 2018 P16,000

Problem No.1. Trading Securities At December 31, 2017, BAGCPARS Company properly reported the following Trading equity securities: Page 1 EDA Corporation, 1000 shares, Preference shares DJOA, Inc. 6,000 shares of ordinary shares RVFE Co., 2000 shares Total Cost Market Value P30,000 90,000 80,000 P200,000 February 14 P40,000 60,000 55,000 P155,000 During 2018, the following transactions occurred among others: January 5 Acquired 8,000 shares of ARP Co. for P880,000 incurring additional P10,000 for brokerage and another P10,000 for commission. These shares are to be initially recognized as trading securities Received dividends from ARP Co. declared January 10, 2018 P16,000

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter10: Stockholder's Equity
Section: Chapter Questions
Problem 93.6C
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Problem No.1. Trading Securities At December 31, 2017, BAGCPARS Company properly reported the following Trading equity securities: Page1 EDA Corporation, 1000 shares, Preference shares DJOA, Inc. 6,000 shares of ordinary shares RVFE Co., 2000 shares P40,000 60,000 55,000 P155,000 Cost Market Value P30,000 90,000 80,000 P200,000 Total During 2018, the following transactions occurred among others: January 5 Acquired 8,000 shares of ARP Co. for P880,000 incurring additional P10,000 for brokerage and another P10,000 for commission. These shares are to be initially recognized as trading securities Received dividends from ARP Co. decdared January 10, 2018 P16,000 Received dividends of P2 per share from DJOA Inc. February 14 March 18 November 15 Sold 2,500 shares of DJOA, Inc. for P50,000. Commission and taxes for P5,000 were paid for the sale December 15 Recorded a transfer of all remaining DJOA's shares to FVTOCI when the fair value was P14. On December 31, 2018 the following are the available market values per share: EDA Corporation-preference shares Р50 DJOA, Inc. ordinary share 15 RVFE 45 ARP Co. 100
Transcribed Image Text:Problem No.1. Trading Securities At December 31, 2017, BAGCPARS Company properly reported the following Trading equity securities: Page1 EDA Corporation, 1000 shares, Preference shares DJOA, Inc. 6,000 shares of ordinary shares RVFE Co., 2000 shares P40,000 60,000 55,000 P155,000 Cost Market Value P30,000 90,000 80,000 P200,000 Total During 2018, the following transactions occurred among others: January 5 Acquired 8,000 shares of ARP Co. for P880,000 incurring additional P10,000 for brokerage and another P10,000 for commission. These shares are to be initially recognized as trading securities Received dividends from ARP Co. decdared January 10, 2018 P16,000 Received dividends of P2 per share from DJOA Inc. February 14 March 18 November 15 Sold 2,500 shares of DJOA, Inc. for P50,000. Commission and taxes for P5,000 were paid for the sale December 15 Recorded a transfer of all remaining DJOA's shares to FVTOCI when the fair value was P14. On December 31, 2018 the following are the available market values per share: EDA Corporation-preference shares Р50 DJOA, Inc. ordinary share 15 RVFE 45 ARP Co. 100
4. The unrealized gain (loss) and where do we present the unrealized gain (loss) at the end of the year? a. 50,000 gain to income statement b. 50,000 loss to the income statement c. 37,500 gain to the balance sheet d. 37,500 loss to to the balance sheet 5. The total adjusted carrying value of the investment at the end of the year. a. 992,500 b. 1,062,500 c. 1,026,500 d. 1,025,000
Transcribed Image Text:4. The unrealized gain (loss) and where do we present the unrealized gain (loss) at the end of the year? a. 50,000 gain to income statement b. 50,000 loss to the income statement c. 37,500 gain to the balance sheet d. 37,500 loss to to the balance sheet 5. The total adjusted carrying value of the investment at the end of the year. a. 992,500 b. 1,062,500 c. 1,026,500 d. 1,025,000
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